Strictly Commercial

Those hours spent on the train, waiting for an appointment or crammed into the bulkhead seat of an airplane — what's a businessperson to do with all that downtime? If Neil Versen has his way, a lot of it will be spent looking at advertising.

Online banner advertising and click-ads haven't had the success Web companies hoped for. But according to Versen, senior director of My AvantGo, that's because online advertising hasn't been applied to the mobile environment.

“It's all about mindset,” Versen said. “People don't mind looking at advertising when they're on the plane, train or bus. Online at work, people are trying to accomplish their jobs and don't want to be bothered with ads. We're catching them at a point when they're willing to look at advertising.”

My AvantGo — the consumer side of mobile enterprise software provider AvantGo — has a fairly simple business model: It offers PDA users free content from hundreds of sites while charging content providers for pages in its portal. Its main revenue source, however, is advertising — banner ads, mostly. Standard click-through rates on the desktop Internet are only fractions of a percent, but My AvantGo claims 2% to 3%. And of those wireless users who actually view the ad, 10% to 20% will “convert” — i.e., fill out the survey, ask for more information, buy the product, etc. “That makes a very strong statement about how powerful this medium is,” Versen said.

My AvantGo makes money two ways. If it charges by the impression (the number of users who see an ad), it can set much higher rates because of its impressive follow-through. (Versen said AvantGo charges $32.40 for every 1000 impressions on its homepage, while Yahoo typically charges 22¢ for every 1000 impressions on its own desktop Internet portal.) Otherwise, it can charge per lead generated or per ad clicked on. And because PDAs gravitate toward the upper tiers of the consumer elite, the demographics of AvantGo's customers tend to be very attractive to advertisers, which are thus willing to pay more.

Mobility, however, doesn't imply wireless connectivity. My AvantGo's service may operate over PDAs, but updating its content requires synchronization through a PC. That is its advertising effort's biggest limitation because any customer response has to wait for the next synchronization before it makes its way back to the advertiser. There's no possibility of instant response to a potential customer if there's no link back to the Internet.

But Versen said My AvantGo is working on rectifying that situation as wireless data becomes more prevalent in different parts of the world. In Europe, for example, synchronization is performed automatically via Bluetooth, and as Wi-Fi and other data technologies become standard in PDAs, AvantGo is exploring synchronization through carrier networks — not only giving its customers more real-time content but also giving its advertisers real-time access to their customers. Give My AvantGo nine to 12 months, Versen said, and it will make that move from merely mobile to fully wireless.

That may not be as easy as it sounds. While My AvantGo and other “sync-and-go” PDA companies have had success with synchronized advertising models, going fully wireless has its quirks, said Adam Zawel, wireless analyst with The Yankee Group. If customers are charged per minute or per bit rates by their service providers to look at that advertising, he said they'll probably have second thoughts.

In which case customers may decide they want My AvantGo to simply AvantGo away.